NHAI Current Affairs - 2019

A memorandum of understanding (MoU) has been signed between Indian Highways Management Company Limited (IMHCL) and leading Oil Marketing Companies (OMCs) like BPCL, HPCL and IOCL for sale of FASTags through their petrol pumps.

FASTag

FASTag is an electronic toll collection system operated by the National Highway Authority of India (NHAI). FASTag enables automatic deduction of toll charges and lets you pass through the toll plaza without stopping for the cash transaction.

FASTags are linked to a prepaid account from which the applicable toll amount is deducted automatically. FASTag employs Radio-frequency Identification (RFID) technology.

Features of the FASTag

The features of the FASTag are:

FASTag is bank neutral and can be linked to customers’ choice of bank accounts.

Together with providing flexibility and convenience to the users, FASTag is also user-friendly as there will be no requirement of fulfilling KYC obligations.

Radio-frequency Identification (RFID) technology

A two-way radio transmitter-receivers called interrogators or readers send a signal to the tag and read its response. The RFID reader transmits an encoded radio signal to interrogate the tag. The tag receives the message and then responds with its identification and other information.

National Highways Authority of India (NHAI) has singed Memorandum of Understanding (MoU) with country’s largest lender State Bank of India (SBI) for long term unsecured loan of Rs. 25,000 crore for 10 years with 3 years of moratorium on repayments. This is SBI’s highest long term unsecured loan to any entity and also largest loan ever sanctioned to NHAI in one stroke by any institution.

Key Facts

The loan sanctioned by SBI is unsecured. It has no principal repayment liability for initial three years. But after three years, repayment will be done in 14 equal half yearly installments. The total loan tenure is 10 years. NHAI can repay or prepay it at any time without any prepayment penalty. The rate of interest will be based on one month marginal cost of funds based lending rate (MCLR). Interest accrued on amount actually outstanding will be paid on monthly basis.

Background

NHAI traditionally relied on borrowing through long term bonds issued to various investors, including LIC, EPFO and other qualified investors and Tax Free bonds and Masala Bond issued in year 2017. But recently it had invited Expression of Interest (EoI) from Scheduled Commercial Banks (SCBs) to fund Rs. 25000 crore as unsecured loan for 10 years with 3 years of moratorium on repayments. In response to this EoI, SBI had offered to fund t entire requirement of Rs. 25000 crore based on one month MCLR.

National Highways Authority of India (NHAI)

NHAI is an autonomous statutory agency of Central Government, responsible for management of network of over 70,000 km of national highways in India. It was established through NHAI Act, 1988. In February 1995, it was formally made an autonomous body. It is nodal agency of Ministry of Road Transport and Highways. It is responsible for development, management, operation and maintenance of National Highways. It is headquartered in New Delhi.